Law 421 Case Scenario: Big Time Toymaker.

Case Scenario: Big Time Toymaker.The parties did have a contract for exclusive negotiation rights as stated in the case scenario. Big Time Toymaker (BTT) paid Chou $25,000 for a 90-day period of exclusivity, thus prohibiting Chou from soliciting or entertaining offers from other parties. The agreement stipulated that unless it was written no distribution contract existed. Prior to the 90-days elapsing, the parties reached an oral agreement and BTT sent Chou an e-mail titled “Strat Deal” covering the key terms of the distribution agreement reaffirming the oral agreement. This e-mail does not constitute a contract for several reasons. First, this was part of the negotiation process and Chou failed to draft the contract to “memorialize" the deal. Second, the requirement of a signature is in compliance with the statute of frauds. This is the one element uniformly required to compel a court to enforce. Factors that weigh in for Chou are first, the e-mail sent by BTT’s manager clearly shows delineates the terms of the distribution agreement. Second, BTT’s request for the draft contract even after a month had elapsed. These actions go to show that BTT intended to continue the deal even after a month. Factors that weigh against are first, Chou failed to send the draft contract as he stated. Second, Chou assumed the e-mail sent by BTT took the place of a written distribution agreement contract. Third, he failed to follow up and get an agreement in writing signed. BTT’s e-mail to Chou caused further investigation in the analysis of the first two questions. First, the case scenario states the e-mail was sent by “a BTT manager,” not the chief executive officer or the like. The e-mail on its own is not sufficient to constitute “signed writings” within the meaning of Statute of Frauds. Last, the e-mail lacked the typed name of the person at BTT authorized to make the deal. BTT could not back out of the contract under the doctrine of mistake. Under this doctrine there has...

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CaseScenario: BigtimetoymakerLAW/421CaseScenario: Bigtimetoymaker
In regards to the first question; at what point, if ever, did the parties have a contract?
It is this student’s opinion that there was no legal contract. BTT paid for exclusive negotiation agreement for a 90 day period and although considerations and terms were verbally agreed upon between both parties during that time, Chou did not reply to the email stating the terms from BTT, and it was not until months later that he heard from them again. Although both parties agreed verbally to the terms, the lack of a reply from Chou cannot justify a contract as there was no acceptance to the terms. If Chou would have replied to the email within the 90 day timeframe and agreed to the terms, that would have constituted a contract.
The second case question; what facts may weigh in favor of or against Chou in terms of the parties’ objective intent to contract? A court could conceivably agree that Chou believed that there was intent to contract, but the terms of the negotiation were very specific in that any agreement had to be in writing within 90 days. BTT provided the agreement terms in the email, but Chou’s lack of response before the deadline ruined his chance for the intent to contract clause.
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BigTimeToymakerScenarioLAW/421BigTimeToymakerScenario
In chapter six of The Legal Environment of Business: A Managerial Approach: Theory to Practice, Melvin presents the casescenario of BigTimeToymaker (BTT) and Chou the game inventor. In the scenario, Chou invents a strategy game titled Strat. The scenario follows the events as BTT and Chou negotiate the potential distribution of Strat, ending with BTT declining to distribute the game. The legal issues presented are as follows:
At what point, if ever, did the parties have a contract?
BTT and Chou must exhibit mutual assent to determine when a contract was reached. The contract is determined to be valid if shown that an offer was made (by BTT), and there was acceptance by Chou. Initially, BTT and Chou entered a 90-day agreement for exclusive negotiation rights to Strat in exchange for $25,000. Once payment is accepted, Chou’s right to solicit distribution from an outside party is restricted. This shows mutual assent as the promisee, Chou, gave up a legal right and the promisor, BTT, made its promised based on a mutual exchange.
Additionally, Chou and BTT reached an oral agreement for distribution on day 87 of the 90-day exclusive negotiation agreement...

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BigTimeToymakerScenario
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August 4, 2014
Barry Preston
BigTimeToymakerScenario
At what point, if ever, did the parties have a contract?
After carefully reviewing all of the information about the case of BigTimeToymaker (BTT) and Chou, I have found that there were two different contracts in place. In the text it describes a contract as “a promise or set of promises enforceable by law” (Melvin, 2014), these contracts can be oral or written. The first contract in place is a bilateral contract, this contract is clearly defined in the practice theory when BigTimeToymakers offers Chou $25,000 in exchange for “exclusive negation for a 90-day period" (Melvin, 2014, p.155) to which Chou accepted. The second part of this contract is when BigTimeToymakers pays Chou $25,000 for this agreement, and he accepts the cash. The second contract that was agreed on at a meeting between BigTimeToymaker and Chou toward the 90-day agreement was a verbal agreement approved by both parties, but wasn’t complete as there was a clause in the original agreement that stated that a written agreement would be the only way that a...

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CaseScenario: BigTimeToymakerLAW/421CaseScenario: BigTimeToymaker
At what point, if ever, did the parties have a contract?
Chou and BTT reach the point of having a contract when they agree to all terms. In the email send by BTT covering the obligations of the parties and the terms of the agreement, BTT showed objective intent. According to Melvin,” Objective intent Requirement for an offer to have legal effect necessitating that generally, the offer or must have a serious intention to become bound by the offer and the terms of the offer must be reasonably certain” (Melvin, 2011, pa 724). Because the contract did not involve the sale of goods, land, or lease of goods or land a written contract was not necessary. In the case of Chou and BTT contract, this situation deals with services for the distribution of the game, and not a production contract or a sales contract.
What facts may weigh in favor of or against Chou in terms of the parties’ objective intent?
Chou has some facts in his favor. Three days prior to the end of the 90 day the participants reached an oral distribution agreement at a meeting and soon thereafter, an email was transmitted to Chou from a BTT representative with the specifics of the agreement. The email stated, “That all of the terms had been agreed upon.”...

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Dr. Mark Pugatch BS, MBA, JD
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According to Melvin, 2011 “an agreement may result in a binding contract, whether it is an oral or written agreement between parties”. BigTimeToymaker (BTT) had shown interest in the new strategy game developed by Chou, called Strat. There were oral agreements for exclusive distribution rights, but had stipulations that it must be in writing. There were also emails sent, but a formal contract was never executed. As simple as Melvin’s definition of a contract may seem, certain situations and assumptions made can cloud the situation. In this casescenario, the team will address some of the issues and outcomes of the scenario based on the facts provided below.
Background
“BigTimeToymaker (BTT) develops, manufactures, and distributes board games and other toys to the United States, Mexico, and Canada. Chou is the inventor of a new strategy game he named Strat. BTT was interested in distributing Strat and entered into an agreement with Chou whereby BTT paid him $25,000 in exchange for exclusive negotiation rights for a 90-day period. The exclusive negotiation agreement stipulated...

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BigTimeToymakerCaseScenario: BigTimeToymakerBigTimeToymaker (BTT) develops, manufactures, and distributes board games and other toys to the United States, Mexico, and Canada. Chou is the inventor of a new strategy game he named Strat. BTT was interested in distributing Strat and entered into an agreement with Chou whereby BTT paid him $25,000 in exchange for exclusive negotiation rights for a 90-day period. The exclusive negotiation agreement stipulated that no distribution contract existed unless it was in writing. Just three days before the expiration of the 90-day period, the parties reached an oral distribution agreement at a meeting. Chou offered to draft the contract that would memorialize their agreement. Before Chou drafted the agreement, a BTT manager sent Chou an e-mail with the subject line “Strat Deal” that repeated the key terms of the distribution agreement including price, time frames, and obligations of both parties. Although the e-mail never used the word contract, it stated that all of the terms had been agreed upon. Chou believed that this e-mail was meant to replace the earlier notion that he should draft a contract, and one month passed. BTT then sent Chou a fax requesting that he send a draft for a distribution agreement contract. Despite the fact that...

...CaseScenarioLAW421: Contemporary Business Law
July 1, 2012
1. The contract formed at the meeting just before the 90-day expiration period but the exclusive negotiation agreement stated that a distribution contract did not exist unless it were in writing. The agreement formed at the meeting was an oral agreement. However, because the e-mail that was sent to Chou by the BTT manager contained the key terms of the distribution agreement (price, time frames, and obligations of both parties) the e-mail met the requirements of a contract.
2. The first point in favor of the intent of contract was the initial payment from BTT to Chou in exchange for the exclusive negotiation rights. The second would be the meeting where the oral agreement had taken place. The third point in Chou’s favor would be the email sent by an BTT manager stating the terms of the distribution agreement. The only thing not in Chou’s favor is that both parties did not specifically agree to the terms on a contract signed by both parties. However, there was intent to contract so there is also intent to accept.
3. The parties were not only communicating by email so it does not have an impact on the analysis. The parties had a physical meeting where they made the oral agreement. The e-mail met the requirements of a contract and therefore should not matter that it was an e-mail.
4. “The most common types of...

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BigTimeToymakerLAW/421
May 20, 2014
Aileen S. Azadian
Question 1
At what point, if ever, did the parties have a contract?
Answer: BigTimeToymaker and Chou had an oral contract. In a meeting that included BigTimeToymaker and Chou an agreement was reached. Additionally, an e-mail was sent by BigTimeToymaker to Chou that confirmed the terms of the agreement that were discussed during the meeting.
Question 2
What facts may weigh in favor of or against Chou in terms of the parties’ objective intent to contract?
Answer: There are three facts that are in favor of Chou. The first fact is, three days prior to the end of the 90 day exclusive negotiation rights agreement, Both parties came to an oral agreement. Secondly, an email from BigTimeToymaker was sent to Chou that outlined what was discussed at the meeting. Thirdly, BigTimeToymaker sent Chou a fax asking him to send a draft distribution contract. There is one fact that weighs against Chao. BigTimeToymaker and Chao never signed an actual contract.
Question 3
Does the fact that the parties were communicating by e-mail have any impact on your analysis in Questions 1...